VSE output not going full screen
As it turns out, blender is just fine, and the problem was in mplayer, something that or other, xv, x11 thingy... i took videos on other machines (linux and windows) and files were working just fine in full screen. So i went after mplayer, and there was this update that required restart of X11...

anyway, i am sorry i took your time, noobs like me are probably the worst kind...